Saturday, September 05, 2009

China owns the United States --or, at least, holds a 'mortgage'. China props up the dollar just enough to ensure that its excess production can be dumped here by way of its US retail outlet --Wal-Mart! The value of the US dollar is almost entirely dependent on China. When it ceases to be advantageous for China to prop up the dollar, the dollar will collapse.

The decline and fall of the American empire is a sorry, tragic saga. It is the story of betrayals of this nation by the likes of Richard Nixon, Ronald Reagan , Bush Sr., the Shrub, and many lesser known 'agents' of the increasingly tiny cadre of ruling elites. It is the story of how GOP administrations paid off its elite base with tax cuts which have had, in fact, the effects of impoverishing the poor, enriching the rich, exporting the US manufacturing base, and exporting the jobs that it had supported.

There are many versions of the 'supply side' story, but the most famous one involved a napkin and a Pizza Hut. While Ronald Reagan still occupied the White House, an alleged "economist" is said to have drawn a fictitious curve on a napkin. [More about this 'curve' to come.] As a result, millions lost their jobs, tent cities sprang up across the country, the nation plunged into a great recession --the deepest, most severe, the longest since Herbert Hoover's "Great Depression! I saw some of those 'tent cities' in 'boomtown' Houston. I was inspired to publish an essay in a local magazine. My essay was entitled: "What happened?" In a word, the bulls had gone bear if not 'bare'; the captains of capital cashed out at the top and left many another holding real estate that was declining rapidly in values. The least fortunate were those whose interest in Real Estate was simply that of keeping a roof over the heads of family members. Many of these folk lost their homes and moved into the 'tent city'.

Under the occupancy of George W. Bush, the folly was repeated and the harmful effects left to Barack Obama whom it is hoped will take the rap.

Called "preppies", they consulted Republican political campaigns and were in a position to spread economic dogma like 'supply-side' or 'trickle down theory'. Economists Arthur Laffer and Milton Friedman lent an imprimatur of respectability. Laffer, for example, drew a "curve" on a napkin which some believed proved the preposterous idea that reducing taxes for the elite classes would reduce debt and deficit. In fact, when Reagan put the theory to work with his infamous tax cut of 1982, the opposite occurred. Both debt and deficit increased. Supply side, i.e, 'trickle down' theory was proved wrong. Sadly, the GOP has not gotten the memo.

Wealth might have 'trickled down' IF the wealthy had invested tax cuts domestically!

But they don't and probably never have! They squirrel away their windfalls in offshore banks, havens, shady investments or other ways which do not create new jobs, do not raise wages or stimulate capital investments or growth! The opposite has always occurred, i.e, the economy, rather, has always contracted with each GOP tax cut! If the government wishes to stimulate an economy by stimulating spending, it should just cut out the 'middle man' or, as John Maynard Keynes suggested, it should put bucks in mason jars, bury them in a landfill and let 'labor' dig them up! There is no point in letting the very, very, very rich SKIM OFF the top with idiotic schemes like 'trickle down theory'.

Lower income citizens do not bear smaller tax loads as claimed.

In fact, their taxes are always higher as a percentage of income because the working classes do not have access to most forms of depreciation, offshore tax havens, capital gains, tax credits, etc. Because they have dodges which salaried people don't, elites pay much less tax as a percentage of total gross income.

Unfair tax cuts always make the rich richer. Reagan's tax cut, for example, benefited only the upper quintile. [See the GINI Indices at the Bureau of Labor Stats later published by Brookings ] Bush Jr's cuts benefited an elite of just one percent which, as a result of his policy, owned more than 90 percent of the US population. By the end of his reign of terror, this elite of just one percent had increased its share of total wealth, owning more than 95 percent of the rest of the population combined.

I told ya so!

During the 1920s, the wealthy accumulated such exorbitant stocks of cash, they couldn’t spend it all. Instead, they played the stock market, fueling a rapid run-up in stock prices. Lower and middle income households, on the other hand, lacked wealth enough to meet their daily needs and were forced to borrow heavily. Today --the elites have squirreled their tax cut windfalls offshore, effectively removing wealth from the US economy. That is called a 'contraction' and it is the source of many recessions or, more properly, depressions.

Many historians believe that a combination of growing personal debt and a widening wealth gap destabilized the economy and precipitated the Great Depression, characteristics that define the current collapse. Not so long ago, the media touted rising economic growth and a soaring Dow Jones. Those 'signs' of wealth likewise preceded Herbert Hoover's Great Depression. Certainly, the 20s are remembered for vast inequities of wealth financed by growing consumer debt. Neither 'elephant' has left the room.

Welfare for Wall Street

The lessons of Enron and WorldCom were not learned. The GOP still schemes to PIRATIZE your Social Security and are, perhaps, even more motivated to do so now than during the Bush years. PIRATIZING Social Security i.e, letting Wall Street speculators play with YOUR money is the ultimate 'bailout' of crooks who brought you the current 'financial crisis'. There is simply no rational justification for allowing Wall Street to 'speculate', play the markets with your money.

What are 'private accounts' but a government give away, welfare for Wall Street? You already have the right to open a private account of your own anytime you wish. Giving Wall St speculators carte blanche to play the markets with monies you earned by working is foolhardy, stupid at a time when taxpayers have already underwritten a national debt of several trillion bucks. Privatizing Social Security means that when the next collapse occurs, you will pay for it twice --once with an immediate bailout out of tax revenues and --again --with your hopes for a comfortable retirement, the Social Security which you may never see again!

How right wing policies have robbed the US population with "trickle down theory" and other nonsense utterly unsupported with fact or evidence:

In the late 1970s, the top one percent of the US population held 13 percent of the wealth; in 1995 it held 38 percent. [Source: Source: Levy, Frank. The New Dollars and Dreams ].

The top ten percent of the US population owns 81.8 percent of the real estate, 81.2 percent of the stock, and 88 percent of the bonds. [Source: Federal Reserve Bank data in Left Business Observer, No. 72, Apr. 3, 1996, p. 5].

One percent of the US population owns sixty percent of the stock and forty percent of the total wealth. [Source: Hawken, Paul, The Ecology of Commerce: A Declaration of Sustainability. New York: Harper Business, 1993].

The top fifth of households saw their income rise 43 percent between 1977 and 1999, while the bottom fifth saw their income fall 9 percent....

Since 1973, every group in society except the top 20 percent has seen its share of the national income decline, with the bottom 20 percent losing the most. They have just 3.6 percent of national income, down from 4.4 percent a quarter century ago.

Indeed, the top fifth now makes more than the rest of the nation combined...Rebecca Blank, who recently left the President's Council of Economic Advisors, pointed out, ‘We've gone back to levels of income and wealth inequality that this country hasn't seen since the teens and 1920s.’" [Source: Merrill Goozner, Crash of '99?, Salon.com, Oct. 1, 1999; addendum: since 1999, the date the source was published, the situation is much, much worse. Today --just ONE PERCENT own more than 95 percent of the rest of us combined. GOP incompetence and criminality moves so fast these days, it's hard to keep up!].

The top one percent of Americans receive more income than the bottom 40 percent. [Source: Korten, David.When Corporations Rule the World, p. 108].

Federal Reserve median family net worth by percentile for 1992, 1995, 1998, 2001 (Federal Reserve Bulletin January 2003, pp. 1-36). Note the small gains for the bottom 75% of the population and larger gains for the upper 25% and that the 1998 to 2001 gains were largest.

Republicans bought the scam because it made them feel good about being greedy, shallow bastards. The appeal is obvious: trickle down rationalized greed but only after the fact; it made one feel good about one's worst impulses, motives, and elitist bigotry.

To his credit, the Sr Bush called the Laffer Curve 'voodoo economics'. Two politicians, however, bit big. One of them was Ronald Reagan . The other was the Jr Bush, the Shrub, the idiot left behind!

It is a GOP promoted myth that the GOP does not pay attention to 'polls'. That they promote it, proves it's a myth and that 'trickle down' itself is a deliberate lie by which wealth is transferred upward. It the mechanism by which GOP pays off its base! Not surprisingly, trickle down tested well in focus groups. Everyone likes pie in the sky and greedy bastards will always support any measure that is sure to enrich themselves at the expense of those who must work hard for a living.

Republican campaigns are driven by polls, focus groups, and market research. They're rich; they can afford it. Modern sophistry --the teaching of politicians how to lie, how to con the media, how to couch a phrase or deflect a point --was and most surely remains a growth industry.

The Laffer 'curve' was worse than fiction, it was a fraud. But the 16 month long depression which resulted is a disastrous effect that is still with us.

New job creation under Reagan was 2.1% per year compared with Bill Clinton's 2.4% job creation rate.

Reagan's showing, however, may be misleading; almost half of those jobs were in the public sector. In other words, Reagan , though he had promised the opposite, added nearly 2 million jobs to the Federal Bureaucracy. Reagan GREW the government --but NOT the economy.(Incidentally, job growth under Bush Sr, was a mere 0.6% --the worst performance since World War II. ) Reagan tripled the national debt and left huge deficits to his successor --Bush Sr whom Reagan blamed for what can only be called the Bush/Reagan recession.

The disparity between rich and poor grew during the Reagan regime, narrowed somewhat during Clinton but exploded nova-style under Bush Jr.

Almost one half of all American taxpayers were victimized by Reagan 's so-called tax reform; in other words, over 40 percent of those workers had a bigger chunk taken out of their check at the end of Reagan 's misrule than was taken out at the beginning of his regime.

And what about "real wages", i.e, income adjusted for inflation? That declined as well.

The Presidency of Jimmy Carter is often tarred with a made-up, focus group word that has a GOP stench about it: 'stagflation'. Diplomatically, 'stagflation' is a myth and will remain one until I find the memo that proves that it was all just made up, validated, perhaps,by a focus group. In any case, it is a GOP fabrication with which the GOP would forever tar the Carter legacy. In fact Carter is among the best US Presidents in economic terms. Here are the FACTS that the paid liars of the GOP will not tell you:

But, it is objected, the 80s were a period of great prosperity and, surely, Reagan 's tax cut must be credited! The quick response: the 80s, adjusted for inflation, were, in fact, a period of stagnation, increased poverty, and lost job opportunities defined by the export of US jobs, primarily Japan and China.

This was a point about which Milton Friedman reacted very testily, defensively when pressed about it in the grand ballroom of one of the luxury hotels in Houston's famous Galleria. I know. I was there! Friedman said that US jobs are not exported. He was either wrong or excessively pedantic! It was not --after all --a meeting confined to professional economists. For those who must work for a living, Reaganomics represented in a very real and practical sense the export of his/her job! For the real story about the phony 'prosperity' in the 80s, check out: Playing with the Numbers, How So-called Experts Mislead Us about the Economy, Richard A. Stimson

Reagan 's legacy lives:

US manufacturing is all but non-existent as the shelves of Wal-Mart remind every shopper!

Labor never regained a pre-Reagan living standard

wages never kept pace with inflation

'good paying' and/or skilled jobs never rebounded.

The US had only begun to recover in Clinton's second term. [Bureau of Labor Statistics, BEA; summarized by Kangas, Economic Performance] It was left to Bush Jr, then, to finish the job that had begun with the administration of Ronald Reagan, that is, the collapse of the US economy.

The US boasts the world's largest NEGATIVE current account balance while China boast the world's largest POSITIVE current account balance. [CIA, World Fact Book, Current Account Balance] China owns us! China props up the buck because it is still in their interests to do so. China will pull the plug on the buck when it is in their interests to do so! As a result of the GOP policies of Ronald Reagan , Bush Sr and Bush Jr, the US has become a vassal state even as it indulges the delusion of empire! Pathetic!

Supply side --though discredited --reared its stupid head again some twelve years after Bush Sr. failed to grasp the simple maxim:

It's the Economy, Stupid!

For measuring the economic welfare of individuals rather than the strength of the nation, it is necessary to convert the national measure to the amount per individual, family or household. Otherwise, a nation could double its GDP and its population without anyone benefiting. Such an individual measure is real per capita GDP, obtained by dividing real GDP by the population, and this can be very useful for comparisons over time, although it contains the same weaknesses as GDP itself.

Another such measure is per capita personal income, which is the share each individual receives, on average, of total personal income. The latter parallels GNP and GDP, differing only moderately because of adjustments explained in first-year college economics courses (for example, corporate retained earnings and some taxes are deducted, while Social Security benefits, private pensions, and welfare are added).

A paradox almost always arises during recessions. Wages are stagnant, unemployment grows, and yet the media broadcast and print government reports of increasing per capita personal income.

This misleading result can be explained by considering the average income of a population of two: namely, billionaire Bill Gates and almost anyone of the rest of us. Take the total, divide by two, and you have an enormous amount. If Gates adds another billion it raises the average but does nothing for the other individual.

Rising per capita personal income during recessions reflects the gains being made by a small fraction of the population, which are enough to offset the losses of all the rest and thus bring up the average.

A per capita figure has the characteristics of a simple average (the arithmetic mean), but people’s economic well-being depends on how evenly or unevenly the fruits of production are shared in the population. For this reason, the median (that is, the value at the middle of the range, with as many lower instances below as there are higher instances above) is a better measure. It is available statistically in the form of median family income and median weekly wages and salaries.

Another complication is that when a household has more wage-earners and/or people work longer hours, often taking more than one job at a time to make ends meet (as has been happening to an increasing degree), a given amount of real income is not as beneficial as when it came from fewer hours.

Die hard, embittered supply-siders tried to effect a coup by impeaching a popular President who presided over the creation of some 35 times the number of jobs than were created under Bush Sr! The coup didn't work, of course, but the die-hards failed to get the message.

It's the Stupid Economy!

Following the closest election in the history of the nation, an election in which the winner was defined [by Scalia's 'majority opinion'] as the one getting the fewer number of votes, a mediocre, self-described 'retail politician' of few achievements and fewer ideas presumes to lead a nation while declaring:

"This would be a lot easier if this were a dictatorship...and I was the dictator!"

Those are the words of a someone who places loyalty to his ideological party and his corporate constituents above his loyalty to his nation. This is the kind of man who subscribes to "supply side" economics because it justifies his largesse to his corporate sponsors --the Enrons who bought him a public office.

But --it is hard to comprehend the near mass hysteria that accompanies debate on this issue --exploited as it was by Bush Jr's hero, Reagan, who somehow managed to make people feel good about themselves, when, perhaps, they should not have.

Reagan, Bush Sr and Bush Jr, indeed, the GOP, must take the responsibility for the US debt which was, last time I checked, some 7.4 trillion dollars, the highest in US history, perhaps World History. Since Ronald Reagan bankrupted the nation, the US has been a net debtor nation which survives, literally, at China's whim.

You can pay off your old credit cards with new ones for as long as you can find another card willing to extend you credit! Eventually, however, someone will refuse, and you will have to cough up the cash --and, if you can't cover what's due by selling off your assets, you must declare bankruptcy. The US is bankrupt!

Why was the US able to sustain the fraud for so long? Europe was willing to buy our T-Bills because the world's fuel --oil --was traded in dollars. Nations wanting to buy oil, had first to exchange their currency for dollars as oil producer nations demanded payment in US dollars. A crack in the dike was the creation of the Iranian 'oil bourse' where oil would be traded in currencies other than the dollar. That and other less publicized moves explains US antipathy toward Iran and US determination to seize the oil fields of Iraq, specifically, the Bush/Cheney/Carlyle/Halliburton attempted "oil grab" in the Middle East --the raison d'etre for war, the plan behind the convenient pretext called '911'. The history of the US since 1980 is the history of US attempts to seize and/or dominate the world's oil resources and markets.

This was all predictable! It was shortly after the US attack and invasion of Iraq that I posted the following comment on one of NPR's long defunct 'How's Bush Doing Board'.

The most absurd invention in the history of technology --the SUV --will go out of fashion overnight --and so will jobs!

It will make the Great Depression of Herbert Hoover --another GOP charlatan --look like a casual walk in the park.

Tuesday, September 01, 2009

It was not so long ago that GOP Senators Chuck Hegal and Richard Lugar described the Bush administration as "incompetent"! And they were being polite. CONSERVATIVE commentator George Will referred to the Bush administration as "...the gang that couldn't shoot straight!" In Iraq, Bush's "puppet" Allawi said of WMD: "...they must be somewhere!"

WMD are where you find them! But that's not to say that WMD were ever in Iraq! It does not follow that because something is not 'here', it must be 'there'! It does not follow that because something is 'not' then something else 'is'.

The Bush regime was as utterly incompetent as it was evil. Otherwise, Dick Cheney, who supervised 911, would have just ordered his minions to 'plant' WMD in the areas his 'task force' had already targeted for theft! In retrospect, the Bush regime turns out to have been half-assed crooks, half-assed murderers, half-assed liars, a ludicrous gang that couldn't shoot straight.

It might have been Kant who said that there is a moral imperative to be intelligent. By that standard, the GOP grows more evil as it grows more stupid!

The cure that kills!

The GOP under Bush was determined to stay the course if it killed us. It killed many of us --those 'left behind' by Texas' 'dead last' educational system and millions more for whom murdering Iraqis and stealing oil was, perhaps, their career path of last resort!

It was Ronald Reagan who put a smiley face on "psychosis", i.e. the indulgence of delusion as long as it makes you feel good or, at least, better about yourself. Reagan did this for millions who returned his utterly failed administration to office. Thus, the GOP perfected the 'big lie' with research and focus groups. There was simply no way to get a GOPPER elected on fact or reason. Insanity became and remains the campaign strategy of choice for a party that could not, cannot think straight, a party that is either delusional or is dishonest and just pretends to be insane as a cover!

Wealth would trickle down, Dr Feelgood (Ronald Reagan) assured us, if we would but help him make the privileged elite even richer. Wealth didn't trickle down and never has ...but millions swooned as the aging actor made them feel better about themselves [GOP Convention, 1992, Houston]. The effect was as short-lived as are many 'feel good' remedies and sex toys. Come to think of it --every GOP administration is a circle jerk of old cronies, limited intelligences and the morally bankrupt.

'Let them eat cake and live in houses'

Ronald Reagan told us that those made homeless and forced to live in tent cities were "mentally ill". It was the middle class that had been made homeless during those Reagan nightmare years and while Carter occupied the White House, they had lived in houses. I suppose that as long as they were in a house, they were considered by the GOP to be sane. If you don't have a house, the GOP thinks you are nuts!

Official government statistics [Bureau of Labor Statistics, BEA, Census Bureau] prove that job creation and GDP were higher during the Carter years than in any GOP regime since WWII. As they would say in Texas: the GOP 'cain't carry Carter's shit!' Carter is --therefore --a GOP whipping boy not because he failed but because he succeeded.

It must be pointed out that under Clinton, the recently insane went sane again and moved back into houses! The GOP never figured it out! I was surprised when the GOP failed to lambast the Democrats for the dramatic drop in tent sales during the Clinton years.

GOP thought processes are scrambled. GOP logic works backward from conclusions to premises. The late Barbara Olson said that Gary Condit was guilty of murder not because there was evidence against him but because there was none.

Similarly, it was during the 2000 election debacle that Robert Novak said Democrats were 'trying to steal this election by counting votes!' Antonin Scalia would not be outdone. He said that continuing the recount would be harmful to Bush! Indeed! Bush would have lost!

Scalia did not know when to shut the flock up, adding:

Count first, and rule upon legality afterwards, is not a recipe for producing election results that have the public acceptance democratic stability requires.

--Antonin Scalia, U. S. Supreme Court Justice

'Scuse me!

Anyone getting the fewer number of votes is supposed to lose. Scalia was just puking up something that sounded 'scholarly' but, in fact, meant: stop the count while Bush is still ahead!!

I might join THE CHIEF JUSTICE were it my commission to interpret Florida law. But disagreement with the Florida court's interpretation of its own State' s law does not warrant the conclusion that the justices of that court have legislated. There is no cause here to believe that the dissenting members of Florida' s high court have done less than ''their mortal best to discharge their oath of office,'' Sumner v. Mata, 449 U. S. 539, 549 (1981), and no cause to upset their reasoned interpretation of Florida law.

GOP brains should be dissected, studied, diagnosed and then quarantined! Scalia's condition should be written up by someone like Carl Jung who estimated that as much as thirty percent of any population is certifiably psychopathic and/or delusional. The GOP, meanwhile, consulted swamis or anyone who could justify ex post facto the conclusions already drawn, the results desired but not really ever achieved.

Scalia displays psychopathic symptoms which Dr. Gustav Gilbert identified among the Nazi war criminals he studied at Nuremberg.

U.S. Supreme Court Justice Antonin Scalia recently claimed that the Constitution does not prohibit the execution of an innocent man provided that he has had a fair trial. While this is astonishing enough coming from a man who holds himself out as a Catholic -- even more astonishing is how Justice Scalia substitutes his personal religious beliefs for the law and the Constitution.

This extraordinary tale of what we might call substitutionalism, begins with the case of Troy Davis who was sentenced to death by the State of Georgia in 1991 for the murder of a police officer. Davis has always maintained his innocence and sought a new new trial. "Seven key witnesses have since recanted," according to an editorial in The New York Times, "and several people have charged that the main prosecution witness was the shooter. Rather than arguing that there were procedural flaws in his trial, Mr. Davis is making the more basic claim that he is innocent and that new evidence proves it."

U.S. Supreme Court Justice John Paul Stevens declared "the substantial risk of putting an innocent man to death clearly provides an adequate justification." The majority of his colleagues agreed and ordered a federal judge in Georgia to review the new evidence and rule whether it "clearly establishes" Davis' innocence.

But Scalia and fellow traditionalist Catholic, Clarence Thomas, didn't see it that way. "This Court has never held that the Constitution forbids the execution of a convicted defendant who has had a full and fair trial," Scalia opined, " but is later able to convince a habeas court that he is 'actually' innocent."

Again --Scalia, typical of his ilk, thinks 'backward'. Certainly, a 'fair trial', however desirable, is not an ideal but, like 'justice' itself, a means by which the taking of an innocent life by the state is made less likely. The state murder of a provable innocent because all the 't's' are crossed and all the 'i's' dotted is not just Kafakaesque, it typifies the endemic evil of the state itself.

A paper will be written about the many lies that the GOP has told about Social Security. Unless they are stopped, the GOP will one day raid Social Security not because it's broke but because it's not! If SS were broke, the GOP would have nothing to covet, no booty to be divided up among their base of Wall St insiders! When they have seized SS, the GOP will argue that they had to kill it to save it! Social Security 'reform' will consist of transferring more wealth to the wealthy, putting those monies into the hands of the Wall St geniuses who brought you every recession/depression since the Great Depression of 1929 and its more recent reprise under Bushco.

Against Kerry, Bush and the GOP resorted to almost every lie and every GOP fallacy. Millions apparently believed Bush when he told them that because HE failed in Iraq, we should NOT elect Kerry! Perhaps the GOP believed that because the GOP left us record budget shortfalls, deficits, and the world's largest NEGATIVE current account balance, we should never elect Democrats who left instead the more nearly balanced budgets and, often, surpluses! Big Brother must be pleased to learn that all of his 'big lies' have been put to work by the US GOP.

Are we safe yet?

Millions believed Bush when he said that we were certain to get hit by terrorists again and, seemingly in the same paragraph, we were safer! It never occurred to the media to ask: which is it? Are we safer or not?

Obviously --the GOP strategists never figured this one out: did the GOP get more votes by saying we were safer or were more votes gained by saying we were less safe? The GOP consultants and focus group gurus let them down. They never resolved the issue! With any luck, the GOP's central processor will overheat and melt down before the party destroys the US as we knew it!